Cognitive decline is commonly stated as one of the main risk factors for delirium. The aim was to assess the importance of a delirium episode as a symptom of an underlying dementia among community dwelling healthy elderly people in a prospective 2 year follow up study. The study patients consisted of 51 people living at home and older than 65 years of age, without severe underlying disorders including diagnosed dementia, admitted consecutively as emergency cases to hospital because of an acute delirious state and followed up for 2 years. The diagnosis of delirium and dementia were based on the DSM-III-R criteria. The community dwelling patients were evaluated and tested annually by a clinical investigator, a geriatric study nurse, and a neuropsychologist. The medical records of the institutionalised patients were also evaluated. Dementia was diagnosed immediately after the assurance that delirium symptoms had subsided in 14 out of 51 subjects (27%) and the additional 14 subjects were diagnosed as being demented during the 2 year follow up, 28 out of 51 patients (55%) altogether. Alzheimer's disease or mixed dementia was diagnosed in 14 out of 51 patients (27%), vascular dementia in 10 (20%), and dementia with Lewy bodies in two (4%). One case of alcoholic dementia and one case of a non-alcoholic hepatic encephalopathia were also found. A delirium episode is often the first sign of dementia requiring attention from medical and social professionals.